Commerce Next Digital commerce is a journey · licensed software-in-a-box to SaaS subscriptions and...
Transcript of Commerce Next Digital commerce is a journey · licensed software-in-a-box to SaaS subscriptions and...
Commerce Next: Digital commerce is a journey
Technology Institute
At a glance
Businesses don’t need a digital strategy. They need a business strategy for the digital age
November 2015
88% of Tech executives consider digital investments to be a high to medium level priority for their organization
PwC’s 2015 Technology Digital Commerce Survey
PwC 1
Overview
The ability to market, sell and serve
through digital means has become a
key expectation of all enterprises, but
a variety of industry challenges
complicate those efforts at
Technology companies.
An extensive network of resellers
and integrators are involved in the
selling and support process, which
creates technical and operational
complexity;
High-tech industry customers
have experience in technology and
thus have high expectations for
digital capabilities across web,
mobile, and social;
Companies are rapidly deploying
new products and services, and
need to provide easy and
immediate access to pre-sales
information, evaluation products,
and current entitlements;
The time has come for a new
transition, one in which companies
focus not on a digital strategy, but
rather a business strategy for the
digital age. Because of their unique
position within this inflection point,
Technology companies have the
potential to take the lead in making
digital commerce work, work well,
1 PwC’s 2015 Technology Digital Commerce Survey
and inspire customers. That means
understanding the various facets of
digital commerce, while carefully
engaging customers and
enabling partners.
Technology companies find
themselves in a uniquely enviable
position these days. New digital
technology has transformed almost
every element of every business. But
what enterprises have experienced
and delivered up to now is only a
small percentage of what’s possible.
The transformation toward seamless
digital capabilities – and especially
digital commerce – has only
just begun.
In PwC’s 2015 Technology Digital
Commerce Survey, an overwhelming
88 percent of Tech executives
consider digital investments to be a
high to medium level priority for their
organization.1 Achieving a frictionless
state of digital commerce requires
careful business planning,
operational excellence, thoughtful
customer experiences, and a flexible
technology architecture that can meet
current and future needs. Companies
need to start thinking not just of
transactions but of the entire
customer lifecycle. For Technology
companies, addressing this lifecycle
means accommodating more moving
parts than some other industries face.
For instance, Technology companies
tend to have extensive networks of
resellers, partners, and systems
integrators involved in the selling and
support process. Frequently, these
are geographically organized,
necessitating insights into culture,
currency, compliance, and other
concerns. Companies must think
through carefully how to engage
directly with their customers without
upsetting their partner ecosystem. In
addition, companies must think about
the tools they provide their partners
to help them conduct business
more simply.
Technology companies find themselves in a uniquely enviable position these days
Technology companies also tend to
have highly complex product
offerings. These may be hardware,
software, or systems that combine
both. These offerings may involve
complex configuration options,
The Commerce Next series provides PwC’s perspectives relative to the trends and challenges businesses should
consider to remain competitive in today’s evolving digital marketplace. PwC has identified a multi-phase customer
lifecycle that is an important aspect of digital commerce. In this paper, we look at diagnosing and solving
Technology companies’ commerce needs in a digital world. Commerce Next can help clients deliver the next
generation of commerce by focusing on the complete customer lifecycle in an any channel world.
2 Commerce Next: Digital commerce is a journey
professional services, such as
consulting, and educational services,
such as training. The cost and
availability of those services may be
predicated on contractual discounts,
renewal programs, and entitlement or
license compliance. These challenges
separate digital commerce from
traditional e-commerce models found
in other industries.
By virtue of their frequent selling into
IT departments, Technology
companies face the blessing and the
curse that their customers have
extensive experience in technology.
This means they also have extremely
high expectations regarding digital
interaction. These customers have a
high propensity for doing research
either online or among peers long
before they identify themselves as a
prospect and engage with
salespeople. It’s entirely possible that
a Technology vendor without strong
analytics and social strategy may lose
business without ever having
a conversation.
In addition, Technology companies
themselves are strongly impacted by
technology itself. Just as in many
other industries, their business
models are changing. Their customers
can experience their products in more
ways than ever before. The industry
has moved beyond the days of
licensed software-in-a-box to SaaS
subscriptions and “freemium”
models. They can sample software in
trialware versions before buying it, or
even speaking with the company.
These options affect more than
Technology companies’ revenue
streams. They mean that these
companies must accommodate new
ways of doing business, not only at
the beginning of the sales and
deployment process, but also when it
comes time to renew contracts for
products and services.
But it’s important to note that
Technology companies themselves
are not immune from the evolving
digital landscape. They face
competition from new market
entrants – smaller companies with
fewer legacy products and cloud-
based point solutions. Free from
legacy constraints, they can be more
nimble. Their SaaS-based models
simplify installation and reduce
infrastructure costs. They target
influencers rather than buyers with
online evaluations and trials, and
they use the digital channel to keep
field sales teams small.
At the same time, customer
expectations are changing in the B2B
world. Enterprise customers are
consumers in their personal lives, and
they now have expectations based on
their B2C experiences. These
expectations range from easy access
to product information to complex
configuration, quoting, and pricing
online, to self-service portals. Like
consumers, enterprise customers will
look for information both from the
company itself as well as through
social channels. It is important
companies learn to be part of
the conversation.
Based on these reasons, Technology
companies face what may look like a
daunting challenge, one that to solve
it, requires understanding an
unprecedented number of
departments and capabilities. That’s a
big task, but one that – with the right
strategy – can be tamed.
Defining digital commerce
An important aspect of digital
commerce is its ability to encompass
and enfold the entire, multi-phase
Prism framework:
Discover
Transact
Fulfill
Care
Community
Technology companies need to look
at the elements in this lifecycle not
individually, but rather holistically,
and to do so in a way that creates a
completely customer-centric view.
This lifecycle in its ideal form is an
ongoing process, one in which the
customer discovers the vendor and
conducts the transaction, after which
the vendor fulfills the delivery and
provides service and support. As the
process continues, the customer
discovers more of the vendors’
products and services, and the cycle
begins again. Care is frequently
overlooked by Technology companies
as part of the sales and retention
strategy, causing them to lose repeat
business. Therefore, digital commerce
requires tight integration of
technology and business process
across business, IT, marketing, and
support teams.
Technology companies
themselves are not immune from the evolving digital landscape
PwC 3
Discover
The digital channel is becoming
increasingly more important as the
source for generating new leads and
customer acquisition. Potential
customers will often use digital
channels to find and explore offerings
before engaging with field or inside
sales. They expect rich content that
goes beyond standard product
information and they expect
experiences tailored to their needs.
Customers expect easy access to
product information, case studies,
videos, and evaluation products.
Providing these types of capabilities
allow companies to potentially
identify leads earlier, while data
collection and analytics tools allow
companies to engage prospects with
targeted offers earlier in the
sales process.
Even more important, is the
information tracked consistently
across multiple channels, so that
representatives know whether
prospects have visited the website,
queried on social media about
products, or watched a corporate
video online. Transforming a
prospect into a customer means
having a better understanding of their
interests and interactions with the
company than ever before.
Transact
Technology companies should also
consider how to apply technology to
technology selling. Which parts of the
sales cycle can they automate, such as
self-service configuration of quotes?
The goal: automating as many
segments of the sales cycle as
possible, so that salespeople and
partner channels are focused on
productive selling activities rather
than time-wasting administrative
tasks.
At the same time, companies should
apply similar automation capabilities
to both partner enablement and
customer enablement. This means
allowing partners access to sales
systems, and enabling prospects to
design their own desired systems,
even from a pick-list, indicating as
much as possible their options for
other services, such as consulting
and education.
Fulfill
As Technology companies evolve
their products and enhance their
digital engagement with customers,
fulfillment becomes more
Prism: The multi-phase integrated framework
Transact
Fulfill
Care
Discover
Community
4 Commerce Next: Digital commerce is a journey
challenging. It becomes more of a
consideration during both the
evaluation and post-sales lifecycle
stages. Companies must provide their
customers easy self-service access to
those products and services that they
are entitled to use. For cloud
providers, fulfillment is an ongoing
process that requires very high
availability. While fulfillment can be
challenging, the ongoing engagement
creates another opportunity to collect
data and engage with customers.
Care
As the preceding interactions have
changed, so too must support. Many
Technology companies are already
recognizing that support is more than
just resolving break-fix issues – it’s
an opportunity to engage with
customers. In addition,
understanding how end-users
consume products and services
provides companies with tremendous
opportunity to identify high-value
enhancements, engage with
customers, and proactively identify
and resolve support issues.
Thanks to the deeper insight
Technology companies have,
customers in turn expect companies
to be knowledgeable about their
relationships. For example, do
customers have self-service access
into purchase history, SaaS billing,
warranty and licensing expiration
dates (and have indeed checked
them)? If so, customers expect that a
2 PwC’s 2015 Technology Digital Commerce Survey
customer service representative won’t
waste their time repeating
information they already know.
In response to this new landscape of
digital interaction, many companies
have identified executives responsible
for customer success; that is,
ensuring that interactions throughout
the customer lifecycle are consistent
with both customer expectations and
the brand promise.
Community
Cultivating community is critical in
the digital age. Generating
interactions between the customers,
partners, and the company can
encourage the development of user-
generated content that’s mutually
beneficial. Give your customers and
partners a way to communicate
among themselves, while at the same
time use it as a way to discuss
products or new features that may
resonate with customers.
Many of today’s digital customers will
tap into their own social community
to make a decision about a product
before they choose to engage the
company’s call center. Others venture
to social venues to praise or put down
a product. Especially as a Technology
company, it’s vital to monitor and
participate in these conversations.
Companies that cultivate a sense of
community surrounding their brands
can mine insights worth millions
when it comes to reducing
interactions with call centers and
improving products and services to
increase revenue.
The ultimate goal of these activities is
to digitally integrate the customer
lifecycle, creating an end-to-end
customer experience that acts as a
competitive advantage for Technology
companies. Done well, such a digital
commerce strategy puts the
customers first and capabilities are
delivered through operational and
technical excellence. Tools should
remove friction from the process as
much as possible and enable all
participants in the process: prospects,
customers, partners, salespeople,
marketing staff, and the technical
support team.
Supporting an end-to-end digital commerce experience
As much as automation and self-
service capabilities can support a
digital commerce strategy, one cannot
be deployed solely on the foundation
of technology. Technology companies
must consider the many
organizational implications as well.
They need to address internal
organizational challenges and
confirm they do not constrain the
company’s ability to deliver digital
experiences. Digital commerce should
provide a single face to the digital
In the digital commerce world, Technology companies must be
able to embed and analyze processes across all stages of the lifecycle to measure business impact
Today, most customer support
remains high touch. Email and phone remain the most popular ways of providing support, but 60% of executives claim to have enabled online self-service for their digital customers.2
PwC 5
customer, one that hides the
complexity and internal
organizational structures.
Operationally, everything from billing
to refunds needs to make a
customer’s experience seamless and
as convenient as possible. Enabling
employees to provide products and
services to customers across all
phases of engagement helps provide
the best experience possible.
For many Technology companies,
moving toward an integrated digital
commerce capability starts by
breaking down silos within their
companies. Only by breaking down
silos will they be able to increase
collaboration among internal and
external teams. And only by
increasing collaboration will they be
able to increase customer value,
improve customer experience, and
increase customer engagement.
Before companies can break down
silos and organize teams, companies
must define their business strategy
for the digital age. Companies must
identify who they want to be in the
digital space. Is your digital strategy
to educate prospects and enable
business partners; is your goal to
deliver pre and post-sale capabilities;
or is your strategy to provide direct-
to-customer capabilities that achieve
the multi-phase Prism framework?
How companies answer these
questions will influence
organizational structure, technical
architecture, marketing approach,
and channel strategy.
Another key issue to address: The
ability to drive meaningful business
decisions through data. Consistent
with the shift from transactional e-
3 PwC’s 2015 Technology Digital Commerce Survey
commerce to building a digital
relationship that serves entire
customer lifecycles, analytics – the
ability to track both micro and macro
patterns – become more important.
In the early days of e-commerce, we
looked at discrete statistics such as
net new visitors, page views,
conversion rates, and
cart abandonment.
In the digital commerce world,
Technology companies must be able
to embed and analyze processes
across all stages of the lifecycle to
measure business impact. Given the
complexity and cost of many
technology products, traditional
eCommerce metrics such as average
order value or cart abandonment, do
not apply. Companies must be able to
measure digital commerce’s ability to
attract new leads, assist in the
acquisition of new customers, and
retain existing customers. A well-
executed digital commerce strategy
should reduce the cost of sales,
reduce the cost to serve, and improve
customer retention.
Getting started on the digital commerce journey
While a thorough digital commerce
strategy requires a holistic
perspective, that doesn’t mean that
Technology companies’
transformations require an
enervating “boil the ocean” effort.
Creating a distinguished digital
commerce experience – one that
transcends simply adding more
technology – is an evolutionary effort,
not a revolutionary one. For the sake
of competitive advantage, of course,
it’s important to start the process,
especially since competitors are doing
so and catching up may be difficult
later. But the process can be broken
down into smaller tactics, using the
following leading practices.
Think about customer-
centricity. What kind of
experience do you want prospects
and customers to have? How can
you reduce or even better,
eliminate, friction and confusion
among processes? Indeed, each of
the following points should be
viewed through the lens of
simplifying the customer
experience. Lead with the
customer experience rather have
your current technology drive
the experience.
Identify digital champions.
Within each of the crucial
departments (sales, marketing,
support, IT, product development)
and among your partners, there
are likely people who thrive on
using collaboration to make
processes move faster and more
smoothly. Identify them and get
their input.
Experiment. Unleash your
champions to try pilot projects,
using tools they think will provide
the biggest payoff within the
shortest amount of time. Track the
results to get a sense of the
potential benefits.
Digital impacts revenue &
growth: Increasing sales is the primary objective of the digital channel by an overwhelming majority of Technology executives3
6 Commerce Next: Digital commerce is a journey
Break down silos across
marketing, sales, and service.
Identify ways that these
departments can work better
together. Identify issues that crop
up regularly, and look for ways to
automate or at least speed
up resolution.
Set up an online community.
Give your customers and partners
a way to communicate among
themselves, while at the same time
using it as a way to discuss
products or new features that may
resonate with customers.
Encourage interaction and peer
discussions – and ask how
customers would like to
communicate with the vendor.
PwC works with companies
PwC works with companies, whether in technology or other industries to make the transformation toward a reliable, viable
digital commerce strategy.
The Commerce Next team works collaboratively to help solve business problems with digital solutions. We help our clients
define what’s next for their business: strategy and innovation, technology, user experience, operations, pricing, change
management, security and tax.
Prism is PwC’s framework to help clients evolve their digital commerce ecosystem by diagnosing and solving their
commerce needs in a digital world. The multi-phase framework analyzes the client’s capabilities across the commerce
lifecycle and the supporting business operations, all through an industry lens. It unpacks their current state capabilities
across a number of criteria and provides a benchmark for executing against an ideal future state digital commerce
ecosystem.
PwC’s consultative services start with a discovery of the desired customer experience, followed by an understanding and
mapping of the complex interactions of people, process, and technology involved in the customer lifecycle. This mapping
begins with operations and organizational structure, acknowledges technology and compliance needs, and then overlays
where they affect customer experience.
PwC can accelerate this process through the use of leading industry tools and accelerators. These help from strategy
through execution across the business and technical aspects of a digital commerce initiative. We help our clients make
the transformation toward a reliable, viable digital commerce strategy by using our design tools, leading industry
methodologies and practices for digital commerce, and by incorporating everything from user experience design to back-
end integration. The result is a solution that enhances customer experiences and increases business value across the
customer lifecycle. We have used this approach many times to help global Technology companies become more efficient
and increase revenues.
www.pwc.com
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PwC US helps organizations and individuals create the value they’re looking for. We’re a member of the PwC network of firms in 157 countries with more than 208,000 people who are committed to delivering quality in assurance, tax and advisory services. Find out more and tell us what matters to you by visiting us at www.pwc.com/us.
This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.
PwC can help
For a deeper discussion on digital commerce, please contact one of our leaders:
Joseph Lamano
Principal, Digital Commerce Leader
408 817 4427
Let’s talk
Please reach out to any of our technology leaders to discuss this or other challenges. We’re here to help.
Pierre-Alain Sur
US Technology Industry Leader
646 471 6973
Kevin Healy
US Technology Assurance Leader
408 817 3834
Kayvan Shahabi
US Technology Advisory Leader
408 817 5724
Diane Baylor
US Technology Tax Leader
408 817 5005
Acknowledgements
The following PwC professionals contributed their experience and knowledge to produce this paper.
Todd McElfresh
Director, Digital Commerce
214 740 6748
About PwC’s Technology Institute
The Technology Institute is PwC’s global research network that studies the business of technology and the technology of
business with the purpose of creating thought leadership that offers both fact-based analysis and experience-based
perspectives. Technology Institute insights and viewpoints originate from active collaboration between our professionals
across the globe and their first-hand experiences working in and with the Technology industry. For more information
please contact Pierre-Alain Sur, US Technology Industry Leader.